Introduction
Honeywell Multinational Conglomerate Company (Honeywell), also known as Honeywell International Inc. is an American conglomerate which brings together several companies producing household, industrial, personal, and corporate products. The current company resulted from a 1999 merger between the old Honeywell Inc. and a much larger AlliedSignal. Despite AlliedSignal being almost double the size of Honeywell, the two companies decided to retain the name of Honeywell for marketing purposes. Honeywell Inc. traces its history to 1885 when the damper-flapper thermostat was invested. This invention became part of the Honeywell portfolio through a 1922 merger between Mark Honeywell and W.R. Sweatt. This created the advent of the Honeywell brand, which has remained to date. It is however, worthy of notice that the Honeywell brand would have been transformed had the year 2000 merger with General Electric not been blocked by the European Commission. For over a century, the name Honeywell has grown into a global household name in all manner of commodities and equipment (Honeywell International Inc., 2017).
Company Overview
Honeywell brings together three business units. The first is Honeywell Aerospace, which as the name suggests deals in aviation-based engineering including aviation engines and avionics systems, plane auxiliary power units and other parts and/or spare parts. The second is Honeywell Automation and Control Solutions, which manufactures home and office appliances. Finally, there is Honeywell Performance Materials and Technologies, which provides specialized raw materials for different manufactures. All three business units represent a wide raging array of global brands and products and are, therefore, inter divided into several units, both local and international. Indeed, out of approximately 130,000 employees, only about 58,000 of them operate within the United States. This means that the bulk of the company’s operations are international in nature (Honeywell International Inc. 2017).
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The current leadership of the company is superintended by David M. Cote as the Chairman and Chief Executive Officer, Shane Tedjarati as Chief Operations Officer and Tom Szlosek as the Chief Financial Officer. Honeywell is headquartered at Morris Plains, New Jersey in what was the former headquarters for AlliedSignal but its operations spread across the USA and all continents. As at the year 2015, the total revenue of Honeywell was US$ 38.58 billion which resulted in a net income of 4.768 billion. This is against an asset base of 49.31 billion and a total equity of 18.28 billion. The company’s stock trades at the New York Stock Exchange under the acronym HON where it is performing favorably.
Among the notable current issues relating to the company is the merger with AlliedSignal which resulted in Honeywell shifting its main operation base from Minneapolis, Minnesota to Morristown, New Jersey. This transition cost over 1000 employees of the initial Honeywell Inc. their jobs. It also resulted in a slump in the company’s stock for almost a decade as the stock only recovered in 2007. The stock slump was exacerbated by the blocked merger with General Electric which both the management team and the stakeholders of Honeywell was very keen on. In 2015, Honeywell moved its headquarters from Morrison to Morrison Plains ostensibly as a cost cutting measure and pursuit of energy efficiency. Among the most recent activities is an ongoing endeavor for the company to yet again move its headquarters, now to Atlanta (Honeywell International Inc. 2017).
Business Strategy
The global success of Honeywell has been assured by a well-articulated and executed business strategy. The primary principle of this strategy is focus. Honeywell has three primary business units with well-established operating parameters. These business units maintain focus on their respective business types which allows them to establish a solid market and customer base. This is as opposed to shifting from product to product in pursuit of better markets. This strategy has worked through the gradual enlargement of the company’s customer base eventually making it one of the global leaders in each of its business units. The second principle of the company’s business strategy is quality. Honeywell does not seek for volume of sale through price wars and cost cutting measure. Instead, the company has established a brand that is in itself a guarantee of quality.
The customer base of Honeywell knows that albeit the company’s products may be slightly more expensive than average, the higher price is good value for money due to the high quality of its products. This strategy makes repeat business the most common source of sales for the company as those who utilize the company’s wide-ranging products develop a preference for them. Finally, the last principle of Honeywell’s business strategy is mergers and acquisitions an attribute of the company’s culture stemming from the days of Mark Charles Honeywell. From as early as 1927, Mark preferred to join the competition rather than fight for the customers. This tradition remains with Honeywell having acquired UOP Russell LLC and Xtralis in 2016 alone (Honeywell International Inc. 2017).
Global presence
Honeywell is a global company both in the market area and also corporate presence. It has a total of 1,250 sites spread across 70 countries with 53% of its market being outside the USA. The company owns over 309 sites in the Eastern and central USA, 115 sites in the Western USA as well as 26 sites in the Caribbean Region. In South America, the company has 8 sites as well as 5 sites in the Pacific region. Europe has almost 200 sites spread across from the British Isles, Continental Europe to the Nordic Region. Africa has 4 main sites with another 16 in Australia. India has 16 sites, with 20 more sites spread across the rest of Asia. This is an absolute global reach from a corporate perspective (Honeywell International Inc. 2017).
From a market perspective, the company’s products from all three business units are utilized across the globe. Among the products with the widest reach is from the aviation unit whose products are both sold and utilized globally. Further, the household and office based goods and services are also sold and used on a global scale. A good example is the Honeywell Total Connect remote service used inter alia for GPS tracking. The service is available in 5 languages including English, Spanish, French and Portuguese. This is a clear indication of a global market reach. Finally, as indicated, over two-thirds of the total employees of Honeywell work outside the USA. This is another clear indication of international focus and a global approach to business (Honeywell International Inc., 2017).
Vision, mission, goals
Honeywell has a conglomerate vision, mission and goals but the most outlined and well particularized vision, mission, and goals rest in the specific business units in general and more particularly upon the individual subsidiary company. This enables the overall vision, mission and goals of the company held by individual companies to be tailor-made and relevant to the operations of the particular company. The conglomerate mission, vision and goals are, therefore, general in nature to allow a wide margin for the subsidiaries. The general vision of the conglomerate is to have a secure, comfortable, cleaner and more efficient future. The primary mission of the company is to harness the power of innovation in order to achieve the vision of the company. This shall be accomplished through the core goals of obtaining comfort, security, hygiene, and efficiency for all its customers (Honeywell International Inc. 2017).
Ethics and Corporate Social Responsibility
Unfortunately, Honeywell’s excellent business strategies cannot be marked by the company’s ethics and corporate social responsibility. The company’s philosophy embraces the pursuit of profits at all costs and the concept of extreme capitalism. In many occasions, Honeywell has been embroiled in employment disputes within and outside the USA with the company being found culpable of unfair labor relations (Reuters, 2015). Indeed, in some instances, the company has been found to have tried to short change labor unions in order to forestall industrial action.
With regard to environmental issues, Honeywell is a global leader albeit in a negative perspective through pollution and environmental degradation. The United States Environmental Protection Agency has remarked Honeywell with the highest propensity for Superfund toxic waste infringements. In many instances, Honeywell has been forced to pay hefty fines and conduct hundreds of clean ups due to production related pollution (Caulfield, 2017). However, the company got the 2006 National Partnership for Environmental Priorities (NPEP) Achievement Award for discontinuing the production of mercury switches. The company has also been accused of producing unfair weapons specifically designed to maim. Further, the company has also been formally accused of tax evasion or unethical tax avoidance (Sanders, 2017).
Conclusion
From an entirely commercial perspective, Honeywell is a success story of monumental proportions. Having been began at the rise of the 20 th century, the company has survived numerous economic hazards including two global wars and several major economic depressions. Through focus on specific business lines, quality and a series of well factored mergers, the company has grown from strength to strength until it achieved the status of a global leader in several ventures. Currently, the Honeywell is a massive and successful company, trading at the NYSE and having a global reach corporately and in terms of market. Unfortunately, as with many traditional American companies, Honeywell embraces extreme capitalism, which has severely affected its social citizenship. From an ethical perspective, Honeywell has been seen to prefer profits to good labor relations and corporate social responsibility. Improvement in this arena would solidify Honeywell’s position as a world class company.
References
Caulfield, C. (2017). Honeywell settles environmental claims for $6M. Retrieved from https://www.law360.com/articles/65448/honeywell-settles-environmental-claims-for-6m
Honeywell International Inc. (2017). Honeywell overview . Retrieved from. https://www.honeywell.com/who-we-are/overview
Reuters (2015, March 21). U.S. Mediators report tentative deal in Honeywell Illinois dispute . Retrieved from http://www.reuters.com/article/us-honeywell-intl-workers-idUSKBN0MH0RD20150321
Sanders, B. (2017). Top 10 Corporate Tax Avoiders . Retrieved from https://www.sanders.senate.gov/top-10-corporate-tax-avoiders
